The Zappos Family Story

Looking Ahead - Let There Be Anything and Everything

We view shoes as just our foundation. We believe that as long as we are known for our service, then expanding into almost any category is possible.

So a little bit of information about shoes: It's a $40 billion market in the US, and in 1999, $2 billion of that was sold by mail order catalogs. In surveying our first customers in 1999, we found that only 1 out of 3 customers had purchased shoes by mail order before, implying that the e-commerce market would be much bigger than $2 billion.

In brick and mortar stores, about 1 in 3 sales are lost due to the customer's size not being in stock. Brick and mortar stores are limited in how much inventory they can carry; therefore, they are limited in the number of brands, number of styles per brand, and number of sizes and widths they can carry.

Zappos Fulfillment Centers currently stocks more than 3 million shoes, handbags, clothing items and accessories from over 1,136 brands. Zappos.com offers the absolute best selection of shoes available anywhere, but much more important to us is that we offer the absolute best service. We staff our call center 24/7.

The Zappos Family currently staffs over 1,300 people. The vast majority of our employees work on the front lines, taking care of our customers or shipping items out of the Zappos Fulfillment Centers.

We believe that the most important key to our success will be our service-oriented culture, and we spend a lot of time and effort working on ways to constantly improve our culture.

For example, every new employee that we hire in our corporate office is required to go through 4 weeks of customer loyalty training (answering phones in the call center) before starting the job that he/she was actually hired for. To us, customer service isn't just a department -- it is the entire company.

Over the years, our focus on service has resulted in our fast growth, driven primarily by repeat customers and word of mouth. Zappos.com's gross merchandise sales have been:

1999: Almost nothing

2000: $ 1.6 mm

2001: $ 8.6 mm

2002: $ 32 mm

2003: $ 70 mm

2004: $184 mm

2005: $370 mm

2006: $597 mm

2007: $840 mm

2008: Over $1 billion

We believe that if we continue to focus on providing the absolute best service and the absolute best shopping experience, then we can continue to grow as a company. Our hope is that our focus on service will allow us to WOW our customers, our employees, our vendors, and our investors. We want Zappos.com to be known as a service company that happens to sell shoes, handbags, and anything and everything.